A bunch of new startups are trying to make it cheaper and easier for immigrants to send money home

Every year, migrants send hundreds of billions of dollars worth of remittances back to friends and family in their home country. And there's a massive industry that facilitates these payments — and has for more than a century.

The legacy remittance industry has been long dominated by cash, which requires physical locations where customers can hand over or pick up money. Building out those retail networks is a huge investment. It's left just a few players, called Money Transfer Operators (MTOs), controlling a bulk of the industry.

BI Intelligence

But these companies' comfortable hold on the industry is now being challenged by digital remittance startups. Digital-first remittance companies are competing on fees and usability, and capitalizing on the way people's expectations have changed with the advent of digital and mobile channels.

In a new report from BI Intelligence, we size the total remittance market, company-specific market share, digital's market share, and digital's growth at major remittance firms. We also assess how disruptive digital startups have been by comparing their fees with market leaders, and by juxtaposing their business models with those of legacy companies.

Here are some of the key takeaways:

Digital's share of the global remittance industry is still fairly small at 6% — but growth is extremely fast at digital-first startups and legacy companies.

Fourteen year-old Xoom makes more revenue from electronic channels than 75 year-old MoneyGram, the second-largest remittance company in the world.

Startups are undercutting incumbents' fees in certain corridors; however, legacy firms have matched prices in many major corridors.

Legacy firms' businesses are already responding to the threats posed by digital by lowering fees and adjusting business strategies. However, they face lower margins if they continue to compete with startups on pricing.

Breaks down the business models employed by each type of remittance company, and determines which ones are in a better position for growth.

Compares transfer fees in various corridors to assess the competitiveness of each firm.

Explores other platforms that could completely upend the industry from the outside.

Determines how legacy remittance companies will fare in the digital age – the answer may surprise you.

Interested in getting the full report? Here are two ways to access it:

Subscribe to an All-Access pass to BI Intelligence and gain immediate access to this report and over 100 other expertly researched reports. As an added bonus, you'll also gain access to all future reports and daily newsletters to ensure you stay ahead of the curve and benefit personally and professionally. >>Learn More Now

Our BI Intelligence INSIDER Newsletters are currently read by thousands of business professionals first thing every morning. Fortune 1000 companies, startups, digital agencies, investment firms, and media conglomerates rely on these newsletters to keep atop the key trends shaping their digital landscape — whether it is mobile, digital media, e-commerce, payments, or the Internet of Things.

Our subscribers consider the INSIDER Newsletters a "daily must-read industry snapshot" and "the edge needed to succeed personally and professionally" — just to pick a few highlights from our recent customer survey.